Short-Term Health Insurance: Coverage, Costs, and Who It’s for

These plans provide temporary protection but typically don’t cover pre-existing conditions. And they often omit some important types of care.

Bob Haegele
Written byBob Haegele
Bob Haegele
Bob Haegele

Bob Haegele is a freelance writer specializing in a variety of topics, including credit cards, insurance, banking, and small to medium business (SMB). He has been freelancing since 2018 and become a full-time freelancer in 2020. His work has been published at Yahoo Finance, Newsweek, Business Insider, and several other well-known publications.

Bob has a passion for helping others learn about money but understands there is rarely a one-size-fits-all solution to financial problems. That’s why he enjoys helping people get into the weeds of financial topics, learning as much as possible to make a more informed decision.

Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

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Short-term health insurance is a type of insurance that can provide coverage for up to four months.

This may be useful when you’re between jobs, missed open enrollment for the health insurance marketplace, or are waiting for Medicare to begin.[1] If you’re generally healthy, a short-term health plan may cost less than some alternatives, making it an option during an in-between period.

But short-term health insurance plans aren’t for everyone. They don’t fall under Affordable Care Act (ACA) rules, so they don’t cover pre-existing conditions. And they may leave out other crucial coverages, like prescription medications.

Here’s what you should know about short-term health insurance, how much it costs, and whether it’s a good option for you.

Quick Facts
  • Short-term health insurance plans typically have annual and lifetime care limits.

  • They typically don’t cover as much as ACA plans. For example, short-term health insurance usually doesn’t cover prescription drugs and maternity care.

  • These plans often have lower premiums than ACA plans but can be more expensive when you need care.

What is short-term health insurance?

Short-term health insurance — also known as short-term, limited-duration insurance (STLDI) — is a health insurance plan that covers unexpected illnesses or injuries when you’re outside of a traditional plan window.

For instance, if you missed ACA or Medicare open enrollment, or don’t qualify for premium subsidies through the ACA marketplace, these plans can serve as a lower-cost alternative.

You can’t buy a short-term health plan through the ACA marketplace. Instead, private insurance companies sell them, including many well-known insurers like UnitedHealthcare and Blue Cross/Blue Shield in some states.

These plans don’t adhere to ACA regulations and don’t provide the same consumer protections as other health insurance plans. Since short-term health insurance plans don’t cover pre-existing conditions, insurance companies can deny you coverage based on your health history. A short-term plan may also not cover essential care, like preventive, newborn, maternity, and mental healthcare, or prescription drugs.

How short-term health insurance plans work

If you’re healthy, it can be easy to get a short-term health insurance plan. You can apply at any time of year and may be able to start coverage as soon as the next day.

But these plans are medically underwritten — meaning an insurer can refuse to cover you or charge a higher premium due to a pre-existing condition.[2]

Generally, STLDI plans work much like other health insurance policies:

  • You’ll pay a monthly premium for your policy.

  • When you need care, you’ll have to meet a deductible, which can be much higher than deductibles for traditional health insurance plans.

  • You’ll have a co-insurance amount and a per-visit copay.

  • If you need care for something your plan doesn’t cover, like dental or vision care, you’ll have to pay those expenses out of pocket.

In 2024, the federal government changed rules around these plans to significantly limit their contract durations. Under the new regulations, policies can’t be longer than three months, with renewals of no longer than one month.

States can also regulate short-term health insurance plans. Some have additional restrictions on short-term health insurance. Others have banned the sale of the plans entirely.

What short-term health insurance covers

Most short-term health plans cover doctor visits, emergency care, and urgent care. Some may provide coverage for preventive care and prescriptions.

These plans may have higher deductibles than ACA-compliant health insurance. They might have lifetime or annual dollar limits on coverage, such as $2 million or less. And short-term health plan provider networks can be limited, which could force you to go out of network if you need a specialist.

Short-term health insurance plans often exclude certain services, so it’s important to read each plan’s coverage terms before you buy. If you’re used to employer-sponsored health insurance plans that provide comprehensive coverage, a short-term health plan could surprise you with an unexpected bill.

Here are some services that short-term health insurance plans typically cover, and some they may exclude:

Service
sort ascsort desc
Typically Covered?
sort ascsort desc
Emergency servicesYes
Hospital staysYes
Doctor appointmentsYes
Mental healthYes, for most plans
Substance abuseNo
Prescription drugsNo
MaternityNo

Keep in mind that even when a short-term health insurance plan provides coverage for a certain service, the amount it’ll pay could be limited.

How much does short-term health insurance cost?

Short-term health insurance plans tend to be cheaper than marketplace plans, but premiums can vary widely based on several factors. To get an idea of how much a plan might cost, we sought quotes from some issuers of short-term policies. We requested sample quotes for a 22-year-old non-tobacco-using male living in North Carolina.

The table below shows estimated quotes, deductibles, and plan limits for each insurer’s most basic offering.

Insurance Company
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Deductible
sort ascsort desc
Plan Limit
sort ascsort desc
Monthly Cost
sort ascsort desc
United Healthcare$5,000$500,000$89
Allstate Health Solutions$25,000$250,000$52
Pivot Health$10,000$100,000$45

Just as monthly premiums, deductibles, and plan limits vary widely, so do out-of-pocket maximums. In our test set, maximums ranged from $10,000 to $32,500. We also had difficulty finding insurers that would provide online quotes, and most asked for personal information before providing a quote.

If you shop for short-term health insurance, you should also consider co-insurance tiers, which determine the percentage of healthcare costs you pay until the insurer starts paying 100% of the cost.

Because health insurance costs can vary widely, compare short-term insurance premiums and deductibles to COBRA and ACA plans. This will put the cost of short-term plans into context.

Factors that affect the cost of short-term health insurance

Like any health insurance plan, several factors affect the cost of a short-term health insurance policy:

  • Deductibles, co-insurance, and copays: Generally, a higher deductible results in a lower monthly premium. Short-term health insurance companies don’t have to cap patients’ out-of-pocket costs, so they’re able to offer very high deductibles.

  • Dollar limits: These plans often have dollar-amount coverage limits. By lowering the amount they ultimately pay out for claims, short-term health insurance plans can offer lower premiums.

  • Age and gender rating: Short-term health insurance plans don’t have to follow ACA limits on gender- and age-based cost variations.

  • Your health: Short-term health insurance plans don’t have to abide by the ACA’s pre-existing conditions rules. That means they can deny you coverage or charge you a much higher premium if you have a pre-existing condition.

  • Your state: States can place requirements on short-term insurance plans that can affect their overall cost.

  • Add-on coverages: Some plans allow you to expand your coverage through add-ons. For example, you might be able to add dental or mental healthcare for an additional cost.

Pros and cons of short-term coverage

The low premiums and flexibility of short-term health insurance plans can be financially helpful. But eligibility concerns, limited coverages, and potentially high out-of-pocket costs can be drawbacks. It’s important to weigh the advantages and disadvantages of this type of insurance before buying a policy.

Pros
  • Low monthly premiums

  • Can enroll at any time

  • Short commitment

Cons
  • Out-of-pocket costs can be high

  • Not subject to ACA regulations

  • May not qualify with pre-existing conditions

Short-term health insurance can be a money-saving way to get basic coverage if you’re in generally good health. But if you have chronic health conditions or need more robust coverage, you should consider other options.

Which states allow short-term health insurance plans?

Most states allow you to buy a short-term health insurance policy. But 15 states ban or effectively block them. Some state regulations do this to protect customers from high costs, low coverage, and other shortfalls of short-term health insurance plans.

The following table highlights states that have banned these policies outright or restricted them in ways that make it difficult for insurers to sell them profitably in the state.

State
sort ascsort desc
Ban or Block?
sort ascsort desc
State Rules
sort ascsort desc
CaliforniaBanSince Jan. 1, 2019, insurance companies can’t sell STLD policies to California residents.3
ColoradoBlockPlans are limited to six months, which has prevented sales of these plans.
ConnecticutBlockState law requires short-term insurance plans to include pre-existing conditions coverage just as other health insurance plans do.
DelawareBlockPlans are limited to three months with no renewals and must spend at least 60% of premiums on medical care.
HawaiiBlockThe state prohibits the sale of short-term plans to anyone who’s eligible for an ACA plan.
IllinoisBanAs of Jan. 1, 2025, insurers can’t sell STLD policies to Illinois residents.4
MaineBlockRestrictions — including required pre-existing coverage, in-person sales, and clear cost comparisons for consumers — resulted in no plans available for sale.
MassachusettsBlockRequires short-term health plan sellers to disclose plan limitations and provide a comparison of plan costs vs. an ACA plan, only sell policies in person, and determine if an applicant would qualify for an ACA policy instead.
MarylandBlockPlans are limited to three months with no renewals.
New JerseyBlockRequires all health insurance sold in the state to be standard health benefit plans. Short-term plans don’t meet these standards.
New MexicoBlockPlans are limited to three months with no renewals.
New YorkBanDoesn’t permit short-term plans of any duration.5 Requires all health insurance policies to be renewable and comprehensive.
Rhode IslandBlockRequires all health insurance sold in the state to meet minimum essential coverage requirements. This effectively excludes short-term plans because of their limited coverage. 
VermontBlockPlans are limited to three months with no renewals, among other limitations.
WashingtonBlockAllows short-term plans of up to three months without renewal but requires them to provide the same coverages as standard plans, including pre-existing conditions coverage.
Washington, D.C.BlockPlans are limited to three months with no renewals and required to provide the same coverages as standard insurers.

Should you consider a short-term health insurance policy?

Short-term health insurance policies aren’t for everyone. These policies are a cheap alternative compared to ACA plans, but they provide very limited coverage. They’re best for protecting you against emergencies, but they’re not an alternative for long-term coverage.

Here are some situations in which you might consider short-term health insurance plans:

  • Between jobs: If you’re between jobs and expect to have employer-sponsored health coverage in the near future, short-term health insurance can help bridge the gap.

  • Missed open enrollment: Open enrollment for the ACA marketplace lasts from Nov. 1 to Jan. 1.[3] If you miss it, short-term health insurance provides temporary coverage.

  • Waiting for Medicare: People typically qualify for Medicare at age 65. If you aren’t there yet but no longer have employer-sponsored health insurance, a short-term plan can provide temporary coverage.

  • Loss of group plan: If you’ve lost your job or lost health coverage for other reasons and can’t qualify for special enrollment, these plans can be a temporary solution.

Remember that these plans aren’t a long-term solution, and limitations often apply. For chronic-care needs or pregnancy care, you may need an ACA plan or Medicaid.

Important Information

Four plan tiers are available on the ACA marketplace: bronze, silver, gold, and platinum. Their average monthly costs range from $364 to $488.

How to buy a short-term health insurance plan

Short-term health insurance plans aren’t available through the ACA marketplace, so you’ll have to look elsewhere. You can buy a plan directly with an insurer or a licensed broker.

Follow these steps to buy a plan:

  • illustration card https://a.storyblok.com/f/162273/x/001e1e2a4c/legal-protection.svg

    1. Research your state’s rules

    Some states ban or block short-term plans, so check your state’s regulations.

  • illustration card https://a.storyblok.com/f/162273/150x150/c231786ab1/insurify-icons-auto-green-96x96_036-medical-report.svg

    2. Understand your options

    Remember that short-term health insurance often excludes certain healthcare services. Be sure you understand what your plan covers — and what it won’t.

  • illustration card https://a.storyblok.com/f/162273/150x150/f76792136c/medical-services-96x96-yellow_040-clipboard.svg

    3. Gather information

    Ensure you have all necessary documents, including your Social Security number, recent medical history, a payment method, a list of preferred doctors, and a list of prescription medications you use.

  • illustration card https://a.storyblok.com/f/162273/150x150/13dbb27bee/law-and-justice-96x96-orange_027-dossier.svg

    4. Compare details

    Be sure you understand your policy’s deductible, co-insurance, copays, and out-of-pocket maximum. You should also be aware of your plan’s annual limits for claims payouts.

  • illustration card https://a.storyblok.com/f/162273/100x100/4d03c561b5/declaration-page.svg

    5. Complete a health questionnaire

    A short-term health insurer may ask you to complete a health questionnaire with information about your medical history and any pre-existing health conditions.

  • illustration card https://a.storyblok.com/f/162273/150x150/b85ef2d0e5/banking-96x96-blue_015-dollar.svg

    6. Pay your first premium

    You must pay your first premium to start coverage.

  • illustration card https://a.storyblok.com/f/162273/150x150/1e2f48c956/confrontation-96x96-yellow_031-banned.svg

    7. Set a cancellation reminder

    Since your plan may only last three or four months, it’s a good idea to set a reminder for its termination date.

  • illustration card https://a.storyblok.com/f/162273/150x150/1d8803fded/credit-and-loan-96x96-blue_019-calendar.svg

    8. Start looking for a longer-term alternative

    These plans aren’t a long-term solution, so look for something that’ll work after your temporary coverage ends.

Short-term health insurance alternatives

Short-term health insurance isn’t the only option when you need temporary coverage. Because these plans aren’t for everyone, it’s always a good idea to consider the alternatives. Other options may provide better coverage and reduce your out-of-pocket costs.

Consider these alternatives:

  • ACA plans: If you’re not eligible for other types of health insurance (employer-sponsored, Medicare, Medicaid), you can buy health insurance through the Affordable Care Act’s open marketplace at healthcare.gov. All plans cover essential benefits like prescription drugs, hospitalization, emergency services, and more. Plan costs vary based on your income and the type of plan you choose. Some people qualify for subsidies to lower their costs.

  • COBRA: Short for the Consolidated Omnibus Budget Reconciliation Act, COBRA allows you to extend an employer-sponsored health insurance plan after you leave a job. Generally, you’ll have 60 days to elect to take COBRA, and the benefits expire in 18 to 36 months. Your plan and coverage stay the same as when you were employed, but you’ll pay 100% of the premium plus an administrative fee.

  • Children’s Health Insurance Program (CHIP): States offer this low-cost health coverage program to children and pregnant women. Rules vary by state.

Learn More: When Does Health Insurance Expire After Leaving a Job?

Learn More: When Does Health Insurance Expire After Leaving a Job?

Short-term health insurance FAQs

Short-term health insurance can be helpful, but you may still have questions about these plans. Check out the additional information below for more information about this type of coverage.

  • Is COBRA or short-term health insurance better?

    Neither is always better. Since COBRA continues your former workplace plan, it may provide more comprehensive coverage. But it also costs more, since you’re responsible for paying the entire premium plus an administrative fee. Consider the costs and coverage when choosing between them.

  • What are the disadvantages of short-term health insurance?

    Some of the most significant disadvantages of short-term health insurance are a lack of coverage for standard services like prescriptions, substance use services, outpatient care, maternity care, and mental healthcare services. It can also lead to higher out-of-pocket costs.

  • Do short-term health insurance plans cover pre-existing conditions?

    No. These plans don’t cover pre-existing conditions. If you need that coverage, consider alternatives like ACA plans and COBRA. These plans often provide more comprehensive coverage since they must meet ACA requirements.

  • Who’s eligible for short-term health insurance?

    Most people can be eligible for short-term health insurance after completing a health questionnaire from the insurer. Remember that most short-term plans won’t cover pre-existing conditions, so if you have one, you may not be able to get a short-term plan.

  • Is short-term health insurance worth the cost?

    If you just need emergency coverage to bridge a short time when you won’t have a more robust plan, the lower premium of a short-term health insurance policy can make sense. But costs can add up quickly if you have to use the plan frequently. And it’s not a replacement for long-term coverage, since you can only be on a plan for four months out of every 12.

Sources

  1. National Association of Insurance Commissioners (NAIC. "Short -Term Limited-Duration Health Plans."
  2. Alabama Department of Insurance. "Short‐Term Health Insurance Plan Information."
  3. HealthCare.gov. "A quick guide to the Health Insurance Marketplace®."
Bob Haegele
Bob Haegele

Bob Haegele is a freelance writer specializing in a variety of topics, including credit cards, insurance, banking, and small to medium business (SMB). He has been freelancing since 2018 and become a full-time freelancer in 2020. His work has been published at Yahoo Finance, Newsweek, Business Insider, and several other well-known publications.

Bob has a passion for helping others learn about money but understands there is rarely a one-size-fits-all solution to financial problems. That’s why he enjoys helping people get into the weeds of financial topics, learning as much as possible to make a more informed decision.

Evelyn Pimplaskar
Edited byEvelyn PimplaskarEditor-in-Chief, Director of Content
Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

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